Mining getting a little bit. Doing to the market . Lets nip in and see how those. Re doing. Ur deals report are will he approached should now go approach chinalco . A rather hefty price. That was a bit of a painful do a. Could they try to deal to build momentum . The american repository stormed ahead. We will see how rio does in london. With thething to do ebola out rate in spain. Outbreak in spain. They have notified they have been subject to allegations of bribery. You a coupleo give numbers. They look like they are disclosing. It is coming off its overall highs. Stephanie funders was here. Simon smiles is here. I know you are going to tie up the names. I know you are the only man who can do it. Do much for the dollar, did she . Her pair the markets for rate prepare the markets for rate rises. A slightly different and in terms of the euro dollar. It really batters it away. Down is already implied . Ideae has a pretty good where it is. Lets bring in the chief strategist. Joining us. They have equities lower. The dax lower. Seeing a big drop off by 4 in Industrial Production. Big weakness. A expecting we are all weak growth. There is a big question as to whether they have the will. Is it going to matter . I look at japan and ask whether that is a good example. Stocksgreat for initially. I think it is going to be anticipatory. Multiples didnt expand. All the investors are rewarding is what they are seeing. They might be anticipating things along the way. Japanese companies have not improved their exports. They have improved profit margins. They are wondering if europe is going to play in a similar way. There is likely to be huge agreement on one thing. I have to say this is the thing early most disturbing thing. Overweight u. S. Dollar, which is a similar thing. Ends it isn when it quite painful. The question isnt not so much re you overweight u. S. The issue is going to be when do. Ou get out one the fed starts to raise rates in the market is not anticipating it. When it starts to happen i would anticipate high volatility. Help me out. S p 500 companies are set to earnings lastheir year. . Ongterm, what does that leave what does that mean . You could say they are not seeing positive spending. Ends with two things. Monetary policy and buildup of cost structures that could not the supported. Reserve speakers this week. I look at the labor market report. Can they just pick and choose and delay the rate hike forever . Why they are talking about data dependencies. It has almost become a religious issue. Many comete, how back . Talk bank ofng to japan. Check out equity markets. They open lower. Rio tinto we expected to pop. Shares higher. We learned glencore rejected the move in august. Bloomberg learned glencore is laying the groundwork to come back. We will talk more after the break. Stay with us. We are back in two. We stream on everything. Online, your phone. Lets talk japan. When it camesteady to extending its stimulus program. That is if the yen continues at its sixmonth low. The central bank discussion around the majority of Board Members who think they should. Rop the timeframe Board Members are concerned investors may see the deadline sliding and that could boost stimulus. I see some of the comments coming from the prime minister. Is that just noise . He needsttom line that the bank of japan to carryon . Has achieved a weaker yen. Some degradation of consumer sentiment. What is the lesson . They have not seen the growth. They would see wages go up. You need to see a significant improvement in banking. When we look at the market s, when they get an goes lower you by the nikkei. You are underweight european equities. Shouldnt it be that you by european stocks . There is not a lot of great pop behind that. And japan we have seen valuation among the lowest they have ever been. In europe multiples are not as you see fundamental start to improve. You see evidence start to play out. In the last week we have in having a lot of internal debate about whether to increase european equities. We are doing a lot of work, and that is worth covering. The water expand the Balance Sheet . You have to do more than a purchase program. Qe might even do solver and sovereign qe. Lets talk about practicalities. With yields this low, is it going to make a difference . A riskfreeng to be carry trade. They are going to rebuild the Balance Sheet. Are they going to take the money regularity. Qe need encouragement beyond. We have done japan. We have done europe. Lets wrap is the view here . Equities are so heavily weighted in certain sectors you cannot even speak about it. The u. K. Economy is doing quite well in terms of raising rates. We do not see it particularly attractive for other parts of the world. We will talk about a company that rubble that has little to do with the united kingdom. Rio tinto. Further they have no contact. The company is not giving up. What do we know . Investors do not think they are going to give up this early. They have jumped. Aftererstand glencore, getting rejected then approached should now go approached chinalco. We understand from people familiar with the matter that chinalcoing is perhaps might be supportive. In addition it was unable to get a seat on rios board. Was perhapsthinking with no deal this year, but maybe they might interested in a deal next year. Help me out with the logic. Is first question you ask iron ore is taking a beating. If the ceo was able to pull this off this would create the largest minor. Bhp is the biggest miner in the world with 150. Glencore would be bigger. You have already got the worlds in termsrading company of commodities. He also wants to be diversified. This would take him further down the road. It would add iron ore. The only big commodity they dont have has been plummeting in 2014 on like of chinese the mans and lack of iron ore on the market. That doesnt mean it wont be in the future. The interesting thing will be the trigger. I was tweeting about this earlier. If you look at the share prices glencore onu see the rise. Rio tinto has fallen on the s back of that. If iron ore continues to decline perhaps, rio tinto and should now go perhaps chinalco might be interested in talking. The first one is the rio tinto price. You have the higher price hasuse already chinalco lost 5 billion on their stake since they got it. Issue is creating the largest minor is raising eyebrows everywhere. They would not only own the commodities, but it would also have the ability to trade them. That might be a concern to china itself. China is the biggest consumer. Forcee seen china glencore to sell some of the asset. We have every reason to believe if the deal was to go through regulators would want to see more asset sales. The chief strategist is still with us. Lets talk about Commodity Markets first. China is a big hubris or desperation . They are more amenable to change. You may be able to achieve a lot and close down some of the more expensive minds. Is probably 70 or 80. You need to bring it lower to be competitive. From that perspective it makes sense. Lets talk about the slowdown in china. In terms of giving china the benefit of the doubt, but when you look at some of the things that make it easier for firsttime buyers, they are making it easier for second time buyers. You are seeing the Chinese Government slowly start to say were going to do what we have to do to sustain growth. This is a challenging issue. What china is doing is unequivocally correct. There are only two or three examples of countries being able to transition from an export driven economy to a consumer driven economy. The u. S. And taiwan are the only ones that come to mind. China is doing the right thing. I think it is going to be a bumpy ride. Thing,e doing the right but you probably are not going to see recovery of growth for a couple hundred years. Life is there any historical example for an economy that has had such a huge credit boom without a big dropoff on the other side . When you have had a massive credit expansion. Back furtheryou go in history that is true. Not really. Were in a world of experimentation. As a result we are seeing the solution being credit creation. Lacks i just want to finish with this. He will sit around a table and talk about risk. For you what is the biggest risk . But for me it has always been trades. It is the u. S. Dollar, the u. S. Stock market, japan. There are a lot of reasons to like those areas. That is the problem. The assets tend to get overpriced based on fundamentals. When to getdebate, out. Thanks for joining us. A quick check on european equities. We opened lower. We are staying lower. By zero point 54 . More disappointing data out of germany for the month of august. What will the q3 number look like . Bad is it for now. E are back in two t stay with us. Welcome back. 8 25. Time to bring you up to speed. The European Union is ready to launch an investigation into amazons luxembourg tax deal. They are looking into whether luxembourg allows amazon to collect illegal subsidies for almost 10 years. Amazon joins starbucks in the deals. 60 at thes fell largest smart phone maker. Samsung stock is down around 15 on the year, while apple has risen nearly 25 . To offload its unit. Aking ship negotiations broke down in july after ibm offered 1 billion to take over the business. Ibm is said to be offering more to take the unit, which has suffered nine straight quarters of falling revenue. The company says they have discovered oil and Exploration Offshore in senegal. We will have more details later this hour. A quick check on european equities. We opened lower. We are staying lower. If you are looking at sterling, check out last quarter. Down over 5 . I talked to someone who knows. We will have some inside. Kevin daly has got the inside after the break. Welcome back to on the move. I am jonathan ferro. 30 minutes into the trading day. The ftse 100 down. The dax is 50 points lower. You wrap up the data in germany and it does not look good. Productiondustrial down 4 this morning for the want of august. We can Economic Data and the biggest a drop since 2009. Not two thousand nine but the concern. The eurozone is slowing down. That is the macro side. We are on the downside. A few Energy Stocks are spiking. 2008 close to 12 . Why . Oil helps. Reservoir, 29et meters and that are working with a joint venture products. The aim is to start activity next year. , rio tinto is climbing higher. We have been covering it all morning. Some m a in the air. Ryanair back. No, we do not want to have a merger a crate the biggest a minor and of the world that many feel there is opportunity we will see glencore, back. We will see glencore come back. Shares climbed higher for rio tinto. Ryanair is down 2 . Saying it is not a compelling buy and they continue to prefer low cost air carriers like ryanair, but not ryan air itself. Theys a easyjet and aig, both have more upside in terms of share prices. Even more interesting and of the sews with ryan air, two plane clipped each other, their wing tips touched each other over in dublin. Delays and have not heard things to badly. Such an intriguing one. One of the biggest fallers. You. Ank here are bloombergs top headlines. The first madrid is to be infect a with ebola outside of africa and the government is finding out how the woman contracted it. Meanwhile, president obama has pledged to boost screening of Airline Passengers entering the u. S. As he carded a Top National Security priority. German Industrial Production dropped at the most since 2009 and august and output fell more than economists predicted, 4 . That is factory orders. A big amiss and manufacturing orders and fail as well. A cause of concern in germany. Maintainingjapan is the wrecker stimulus. According to people familiar, the majority of Board Members now think they should drop the twoyear time frame of meeting the inflation target. This comes as it is after the weakest point since the dollar since 2008. For one central bank to another, the bank of england is out with his latest policy decision. People are expecting that are not expecting them to change their sense. He is Goldman Sachs kevin daly. The fedk they will beat a but that is not the crucial point. We think they will be before the fed. Even though the risk at the as at is more for the u. K. Result of the weakness in the euro area you just talked about. The main point of the pieces chopped about the trajectory of rates and when they begin to rise. It begins at any the u. K. And will be significant more tight and gradual than for the u. S. The tightening of the pace of around 0. 75 over the next three or four years of the u. K. Versus about 1. 2 5 for the u. S. A steeper profile. Is that the differs an approach . We keep hearing they are saying it will be slow. Is there a difference in the approach or their ability . Really their ability. And at the u. K. , much more bang for your buck from Interest Rates increases and why because of the growth levels and how in particular it is in the u. K. And also much shorter duration and mortgages in the u. K. Are quite closely to official Interest Rates so when the bank of england begins to raise, it impacts directly how household income. Thats not true for the u. S. Where in the u. S. , mortgages are much more closely linked to longterm Government Bond yields. A less of an impact from an interest rate. Therefore, a greater need to tighten into the u. S. When they begin. Kevin, there will be people watching and people concerned about their business long rate and this pledge we hear from ,overnor carney, it can be slow is it a pledge they can deliver n . Marco might words. If it comes down to tighten they are currently, the guidance will be very quickly dropped. Thereason why we believe mantra of gradualism from the u. K. Is not because we think that will necessarily keep to the script they have now but because we believe the script because our Economic Forecast adjust it is the right script to have. We do have a much more gradual effect and much bigger effect and the u. K. I think the effects are uncertain at the moment post crisis. That is an additional reason to move relatively gradual. Our forecast suggests that will move. Kevin, i want to talk about the people of the mpc. Are we looking after the recent comments from the mpc . Personomments and one said she has not seen signs of inflation. It is starting to play out . It does. , thexpectations instructions, we do not expect any change this week, nor do we expect any change coming through in november either. The most interesting thing since the august inflation, you have this minority, who are in favor of hiking grace. ,ut the seven, the majority important change in the last couple of months have been how much more convinced they seem to feel. Is a minority and the minority will remain a there. I do not seeing the seven will move anytime soon. We talk about curve ball. The slowdown in europe. How much does it matter for the u. K. And policy . A lot. The euro is by far the uks largest trading partner and we saw the impact of the euro area crisis on the u. K. In particular during 20 2011 and 2012. It has been the Major Development for the u. K. The data continues to be strong. That picture of their restore activity data relatively weaker inflation data seems to be the case. But, the major threat of the moment to the uks economy seems to be the weakness of the euro area. Sterling. 1. 70. Ay ticket to a lot of it was Political Uncertainty around scotland. Elections coming up. For you going forward, is the u. K. Election the biggest hurdle to sterling depreciating . The main thing is Economic Development and the u. K. And sterling traditionally a halfway between the u. S. s dollar and the Euro Currency and i think you have seen that recently. One of the concerns for the u. K. Which is affecting sterling versus the dollar is the weakness from the euro area. It is true, there are more considerations, should we say, we had the Scottish Referendum and where going into a very tight Political Campaign for next may upon stress is election. Ultimately, it will be the currency. Mays election. Yeah, although, wage Growth Continues to be very weak. We see conflation more in the months ahead. Your food Price Inflation and oil prices weakening. Has been thesis underlying inflation pressure is very limited despite growth. There is a lot of spare capacity. Theirermarkets will do best to keep food prices down. Kevin daly. Always a pleasure. Lets turn to will write top corporate stories. Higher shares edged after the Company Posted its biggest drop in quarterly profits since at least 2009. Those withde adjoins the details. A big drop in profits and stock higher . All factored in. Ugly, down 16 in how much profit slumped. It was worse than had been anticipated. Sales were down 18 . Phones are not the selling quite as much because of competition. Competition on the high end from apple. Samsung dominated the larger screen space especially in asia. 6ple comes with the iphone and iphone is 6 plus. Underneath them rising is lenovo and all of the chinese players that are eating into the market share in the emerging markets. City highend, but much cheaper phones. They havent heard in terms of their phone. Tvs not selling as well. As i say, many analysts had been downgrading their expectations. D running up to the numbers. Potentially, there was a bit of a sigh of relief. Less talk about the smartphone business. I can get a cheaper alternative than samsung. If i want a big phone, i can think about getting an apple. How do they improve in the smartphone business . That is where they were hurt. It is the margins, the profitability that are being eaten into. What an was want to see is their next set of false selling well. They unveiled in germany and they brought it to the stores in china faster because they wanted to beat apple and they have the note 4 and many think it will sell well. They also have the note catch. That funky one that drops down. A curved screen. Read our Text Messages on an angle. Generally, that is meant to be flying off of the shelves. What people want to